Economy

More stories

  • 113 Shares33 Views

    in Economy

    US thrift stores bank on windfall from Trump’s tariffs

    by

    US thrift stores are betting that the pain conventional retailers are expected to endure from Donald Trump’s tariffs will be their gain. Many large retailers are bracing themselves for turbulent times as the US president’s levies sharply increase the cost of importing goods, some of which will almost certainly be passed on to consumers. But second-hand sellers are hoping that customers will flock to their stores in search of bargains. “Resale is a rare industry that benefits from the administration’s global tariffs,” said Alon Rotem, chief strategy officer at online consignment and thrift store ThredUp. “Everything we sell comes from the closets of Americans, so everything we sell is immune.”Shares of ThredUp and Savers Value Village — the two largest publicly traded thrift stores in the US — have climbed 31 per cent and 22 per cent, respectively, since Trump announced his “liberation day” tariffs on April 2. The S&P retail select index is down 7 per cent in that time, according to FactSet data. Even after Trump announced a 90-day pause on his “reciprocal tariffs”, the remaining 10 per cent blanket levy on most imports — as well as a combined 145 per cent duty on goods from China — is expected to raise consumer prices by 2.9 per cent, costing the average household $4,700 a year, according to the Yale Budget Lab. Analysts warned that costs for clothing and toys, in particular, could increase sharply in the coming months due to the US fashion and merchandise industry’s heavy reliance on imports from China.Resale, however, allows companies to “sidestep tariffs,” said Simeon Siegel, a retail analyst at BMO Capital Markets. He added that the second-hand market, already popular among younger consumers, would be “doubly attractive” in the event of a recession, as more prospective buyers begin to hunt for discounts. “If tariffs meaningfully affect the availability or price of certain goods like apparel, cars and electronics, we expect to see buyer activity spike in those categories,” said Ken Murphy, chief innovation officer at OfferUp, a peer-to-peer online resale marketplace. Adele Meyer, executive director of NARTS: The Association of Resale Professionals, a trade group, said she was “cautiously optimistic” that tariffs would boost the second-hand industry because resale “always flourishes during any kind of economic downturn”.But some analysts warned that second-hand sellers were not necessarily immune to a supply shock, even if their goods came from within the US. In a climate of increased uncertainty and rising fears of unemployment, consumers might decide to buy less in the first place, or opt to hold on to their existing items for longer, leaving resellers with a smaller pool — and potentially worse quality — of inventory.Publicly traded Savers Value Village, which operates for-profit thrift stores across North America and Australia, was less bullish on demand outside of the US, particularly in Canada More

  • 150 Shares33 Views

    in Economy

    Palau’s president vows to stand with Taiwan ‘til death do us part’

    by

    Unlock the White House Watch newsletter for freeYour guide to what the 2024 US election means for Washington and the worldThe president of Palau has pledged to maintain recognition of Taiwan, but warned that small countries needed to demonstrate the economic benefits of standing by Taipei as China increases pressure on its few remaining allies.Surangel Whipps Jr, speaking at the Lowy Institute in Sydney earlier this month, said he would not change his country’s position during his four-year term, citing Taipei’s assistance during the Covid-19 pandemic and the economic partnership between the countries.“I believe in the principle that when you’re married, you’re married ‘til death do us part’,” he said. But in an interview with the Financial Times, Whipps added that leaders needed to justify that decision by demonstrating the economic value of their diplomatic partnerships to their citizens.“You’ve got to grow the economy and you’ve got to build economic resilience,” he said, adding that maintaining diplomatic ties “comes down to jobs, opportunities, livelihoods”. “We need to prove that we’ve done the right decision,” he added. Palau, a microstate of just 18,000 residents, is one of only 12 countries that recognise Taiwan, which China claims sovereignty over and has threatened to take over by force if Taipei resists indefinitely.The Pacific has been the arena of a power contest in recent years as China, the US, Australia and New Zealand have vied for influence in the strategic region through pledges of investment and trade relationships with small island nations. A number of Pacific countries have also switched their diplomatic allegiance to China, including Kiribati, the Solomon Islands and Nauru.Whipps, who was re-elected in November, defeating his brother-in-law in a general election, said Palau had also come under pressure in recent years. “We do know China has one goal, and that is for us to renounce Taiwan.”Palau is closely aligned with the US, and is one of the three island nations — along with the Marshall Islands and the Federated States of Micronesia — that are signatories to the Compact of Free Association, which gives its citizens the right to live and work in the US. In return, the US stations military forces in Palau and provides substantial funding. Last year, Washington agreed to an $889mn economic support programme for Palau over 20 years.Palau was one of the few countries to avoid President Donald Trump’s sweeping “reciprocal” tariffs — Whipps noted that “unfortunately” it had no exports to the US. But it has been hit by the administration’s decision to dismantle the US Agency for International Development, which had supported disaster readiness, illegal fishing and cyber resilience programmes. Whipps struck a sympathetic tone, however, on Washington’s decision to freeze foreign aid, saying recipient countries needed to be accountable for spending US funds.“I understand the need to check,” he said.He expressed confidence that American funding would return, however, pointing to the resumption of some projects, such as landmine removal and a tender to replace Chinese equipment, including a core network built by Huawei, from the country’s mobile network, which had initially been disrupted by the funding freeze.Telecom networks have become a particular point of friction in the Pacific. Countries including the US and Australia have expressed concerns over the widespread installation of low-cost Chinese equipment across the region. Whipps said “clean networks” in Palau were clearly of strategic interest to Washington, given the presence of US troops.“We know in Palau that everything that I probably put on my phone, China reads — that’s just the way it is,” he said. “That’s why it’s got to be ripped out and replaced.” More

  • 250 Shares59 Views

    in Economy

    Trump tariffs could lead to a summer drop-off in economic activity after an ‘artificially high’ start, Chicago Fed chief says

    by

    Chicago Fed President Austan Goolsbee said Sunday that President Donald Trump’s tariffs are causing U.S. business owners to stock up on inventories.
    “Preemptive purchasing” by businesses, as well as consumers, of big-ticket items at pre-tariff prices may cause an “artificially high” level of economic activity, the central banker said.
    The temporary bump could be followed by a corresponding drop-off in the summer, Goolsbee said.

    Austan Goolsbee, President and CEO of the Federal Reserve Bank of Chicago, speaks to the Economic Club of New York in New York City, U.S., April 10, 2025. 
    Brendan McDermid | Reuters

    Business owners and CEOs are already stocking up on inventory, and some American shoppers are panic buying big-ticket items in anticipation of President Donald Trump’s tariffs. The sudden buying binge could cause an “artificially high” level of economic activity, said Federal Reserve Bank of Chicago President Austan Goolsbee.
    “That kind of preemptive purchasing is probably even more pronounced on the business side,” Goolsbee told CBS’ “Face The Nation” on Sunday, adding: “We heard a lot about preemptive building-up of inventories that could last 60 days, 90 days, if there [was] going to be more uncertainty.”

    Businesses stockpiling inventory and consumers accelerating their purchasing decisions — buying an Apple iPhone now, say, rather than waiting until the fall — may inflate U.S. economic activity in April and lead to a slowdown in the coming months, Goolsbee suggested.
    “Activity might look artificially high in the initial, and then by the summer, might fall off — because people have bought it all,” he said.
    Sectors affected by Trump’s tariffs, particularly the auto industry, are most likely to heavily stock up on inventory now before import levies on goods from other countries potentially rise further, said Goolsbee. Many car parts, electronic components and other big-ticket consumer items are manufactured in China, for example, which currently faces a 145% total tariff rate on goods imported to the United States.
    Trump’s tariffs on a bevy of other countries are currently in the middle of a 90-day pause, with a 10% baseline tariff rate instead applying to all imported goods across the board. The pause is due to expire on July 9, with Trump touting a series of rate negotiations with foreign leaders between now and then.
    “We don’t know, 90 days from now, when they’ve revisited the tariffs, we don’t know how big they’re going to be,” Goolsbee said.

    Some U.S. business owners who buy goods manufactured in China say they already can’t afford to place rush orders on inventory. Matt Rollens, owner and CEO of Granite Bay, California-based novelty drinkware company Dragon Glassware, says he’s temporarily holding his products in China because paying the 145% levy would force him to raise consumer prices by at least 50%, likely drying up customer demand.
    Rollens has enough inventory in the U.S. to last roughly until June, and hopes the tariffs will be rolled back by then, he told CNBC Make It on April 11.
    Short-term uncertainty and financial pain aside, the Fed’s Goolsbee expressed optimism about the country’s longer-term economic outlook.
    “If we can get through this, it’s important to remember: The hard data coming into April was pretty good. The unemployment rate [was] around steady full employment, inflation [was] coming down,” he said. “It’s just a desire of people expressing they don’t want to back to ’21 and ’22, at a time when inflation was really raging out of control.”
    Get Your Ticket to Pro LIVE
    Join us at the New York Stock Exchange!Uncertain markets? Gain an edge with CNBC Pro LIVE, an exclusive, inaugural event at the historic New York Stock Exchange.
    In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12.
    Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!

    Don’t miss these insights from CNBC PRO More

  • 75 Shares32 Views

    in Economy

    The Business Playbook for Tariff Chaos

    by

    President Trump’s trade war is forcing companies to cut costs, raise prices, shrink profits, discontinue products and find other suppliers.Shock. That was the first response to the Trump administration’s barrage of tariffs.Businesses that rely on imported products expected duties, which President Trump had promised. Just not this high, this universal or this sudden, with almost no time to adjust. A 145 percent tariff on all Chinese products, after all, is more like a trade wall than a mere barrier. But shock is settling into reality, and corporate leaders are trying to manage. Here are the main tacks that businesses are taking — at least for now, given that whatever duties the White House declares today may change tomorrow.Move out of China, preferably yesterdayFor many importers, this round of tariffs isn’t as painful as it might have been eight years ago. Mr. Trump’s first trade war, in 2018, while milder, pushed many to diversify their sourcing beyond China. The Covid-19 pandemic sent yet another signal that dependence on a single market, however cheap and efficient, is unwise.For William Westendorf, the chief executive of the medical supply distributor Air-Tite Products, the final straw was a 100 percent tariff on Chinese-made syringes imposed by the Biden administration last fall. He sent a staff member to scour Europe for a factory that could meet the Food and Drug Administration’s exacting standards.After six months of hunting and hoop-jumping — and with Chinese syringes now tariffed at 245 percent total — Mr. Westendorf has a shipment on the way from Turkey. It’s lucky timing, because factories outside of China are getting flooded with orders.“It’s not something you can do real quickly because of the regulatory environment,” Mr. Westendorf said. “Fortunately, we were there early.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 113 Shares32 Views

    in Economy

    Inside a Union’s Fight Against Trump’s Federal Job Cuts

    by

    Leaders of the union representing government workers say their battle is galvanizing but also alarming. “It’s insulting to say,” one said, “that we are lazy.”On a warm, still evening this month, Corey Trammel, a counselor at the Oakdale Federal Correctional Institution in central Louisiana, was at his 11-year-old son’s baseball game when the calls and emails started pouring in from dozens of his colleagues, worried about the latest threat to their union.Mr. Trammel is the president of Local 3957 of the American Federation of Government Employees, the country’s largest union of federal workers. Until recently, Local 3957 had nearly 200 dues-paying members, all at Oakdale, including officers, teachers, case managers and food service workers.Many, if not most, supported President Trump in the 2024 election, said Mr. Trammel, a registered Republican. And many were “in denial,” he said, as the new administration, with tacit support from a Republican Congress, moved quickly to slash and reshape the federal government.The union, which represents some 800,000 workers across more than a dozen federal agencies, has been at the forefront of resistance to that effort. At a moment of peril for the civil service, the union has tried to assert itself as a countervailing force. In doing so, it has also become a target.With his son on the pitcher’s mound, Mr. Trammel was figuring out how to deal with the Trump administration’s latest challenge: The Bureau of Prisons would no longer allow union dues to be deducted from paychecks. Within days, Local 3957 shrank to fewer than 50 paying members, who had signed up to use an online portal to pay their dues — $19.40 every two weeks.“They keep kicking us when we are down,” Mr. Trammel said.In interviews, more than a dozen union leaders and lawyers across the country described their current work as galvanizing, but also alarming and relentless. Some said the crisis had laid bare the challenges of a union that is, by its nature, decentralized and diverse. It is really a federation of many unions, including Border Patrol agents in heavily Republican states, environmental researchers in liberal ones and an array of political inclinations in between.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 88 Shares52 Views

    in Economy

    Peter Navarro: The Architect of Trump’s Tariffs

    by

    On a clear day last July in Miami, Peter Navarro emerged from four months in federal prison, where he’d been imprisoned for contempt of Congress. Mr. Navarro had refused to testify in an investigation of the Jan. 6 attack on the Capitol, an action he described as a defense of the Constitution.Just hours after his release from prison, Mr. Navarro flew to Milwaukee to speak at the Republican National Convention in support of Donald J. Trump’s re-election.“They convicted me, they jailed me. Guess what? They did not break me,” he said that night, punctuating each word as the crowd roared. It was an exercise in loyalty to Mr. Trump that seems to have paid off.For much of Mr. Trump’s first term, Mr. Navarro, a trade adviser, had been sidelined, mocked and minimized by other officials who saw his protectionist views on trade as factually wrong and dangerous for the country.But in the second Trump administration, Mr. Navarro, 75, an economist and trade skeptic, has been newly empowered. He returned to government more confident in his revanchist vision for the American economy, more dismissive of his critics, and with more than a dozen trade-related executive orders already drafted, many of which the president has since signed. Mr. Trump also came back to Washington more determined to finally realize the trade views he has held for decades, that an unfair trading system was ripping America off and needed to be radically changed.Why Peter Navarro switched sidesAna Swanson explains how China’s entry into the World Trade Organization turned Navarro, a Southern California professor, into President Trump’s biggest trade warrior.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 200 Shares67 Views

    in Economy

    Trump’s approval rating on the economy drops to lowest of his presidential career, CNBC Survey finds

    by

    U.S. President Donald Trump arrives for a presentation of the Commander-in-Chief trophy to the U.S. Navy Midshipmen football team of the United States Naval Academy, at the White House in Washington, D.C., U.S., April 15, 2025.
    Evelyn Hockstein | Reuters

    President Donald Trump is registering the worst economic approval numbers of his presidential career amid broad discontent over his handling of tariffs, inflation and government spending, according to the latest CNBC All-America Economic Survey.
    The survey found that the boost in economic optimism that accompanied Trump’s reelection has disappeared, with more Americans now believing the economy will get worse than at any time since 2023 and with a sharp turn toward pessimism about the stock market.

    The survey of 1,000 Americans across the country showed 44% approving of Trump’s handling of the presidency and 51% disapproving, slightly better than CNBC’s final reading when the president left office in 2020. On the economy, however, the survey showed Trump with 43% approval and 55% disapproval, the first time in any CNBC poll that he has been net negative on the economy while president.
    Trump’s Republican base remains solidly behind him, but Democrats, at -90 net economic approval, are 30 points more negative than their average during his first term, and independents are 23 points more negative. Blue collar workers, who were key to the president’s election victory, remain positive on the Trump’s handling of the economy, but their disapproval numbers have shot up by 14 points compared to their average for his first term.
    “Donald Trump was reelected specifically to improve the economy, and so far, people are not liking what they’re seeing,” said Jay Campbell, partner with Hart Associates, the Democratic pollster on the survey.
    The poll was conducted April 9 through 13th and has a margin of error of +/-3.1%.
    The results show that Trump has so far been able to convince only his base that his economic policies will be good for the country over time: 49% of the public believe the economy will get worse over the next year, the most pessimistic overall result since 2023. That figure includes 76% of Republicans who see the economy improving. But 83% of Democrats and 54% of independents see the economy getting worse. Among those believing the president’s policies will have a positive impact, 27% say it will take a year or longer. However, 40% of those who are negative about the president’s policies say they are hurting the economy now.

    “We’re in a turbulent, kind of maelstrom of change when it comes to how people feel about what’s going to happen next,” said Micah Roberts, managing partner with Public Opinion Strategies, the Republican pollsters for the survey. “The data… suggests more than ever that it’s the negative partisan reaction that’s driving and sustaining discontent and trepidation about what comes next.”
    While partisanship is the most significant part of the president’s negative showing, he loses some support among Republicans in key areas like tariffs and inflation, and has seen a notable deterioration among independents.
    Tariffs look to be a substantial part of the overall public’s discontent. Americans disapprove of across-the-board tariffs by a 49 to 35 margin, and majorities believe they are bad for American workers, inflation and the overall economy. Democrats give tariffs a thumbs down by an 83-point margin and independents by 26 points. Republicans approve of the tariffs by a 59-point spread — 20 points below their 79% net approval of the president.
    Large majorities of Americans see Canada, Mexico, the EU and Japan as more of an economic opportunity for the United States rather than an economic threat. In fact, all are viewed more favorably than when CNBC asked the question during Trump’s first term. The data suggest the public, including majorities of Republicans, do not embrace the antipathy the president has expressed towards those trading partners. On China, however, the public sees it as a threat by a 44% to 35% margin, substantially worse than when CNBC last asked the question in 2019.
    The president’s worst numbers come on his handling of inflation, which the public disapproves of by a 37 to 60% margin, including strong net negatives from Democrats and independents. But at 58%, it’s the lowest net positive approval from Republicans for any of the issues asked about the president. 57% of the public believe we will soon be, or are currently in, a recession, up from just 40% in March 2024. The figure includes 12% who think the recession has already begun.
    The public also disapproves of the president’s handling of federal government spending by a 45% to 51% and foreign policy by a 42% to 53% margin.
    Trump’s best numbers come on immigration, where his handling of the Southern border is approved by a 53% to 41% margin, and deportation of illegal immigrants is approved 52% to 45%. The president achieved a slight majority of support from independents on deportations and 22% support from Democrats on the Southern border. While still modest, it’s the best-performing issue for Trump among Democrats.
    Meanwhile, Americans have turned more negative on the stock market than they’ve been in two years. Some 53% say it’s a bad time to invest, with just 38% saying it’s a good time. The numbers represent a sharp turnaround from the stock market optimism that greeted the president’s election. In fact, the December survey represented the sharpest swing toward market optimism in the survey’s 17-year history and the April survey is the sharpest turn towards pessimism.
    The president’s troubles with his approval rating do not appear to be translating for now into significant potential gains for Democrats. Asked about congressional preference, 48% of the public support Democratic control and 46% support Republican control, barely changed from CNBC’s March 2022 survey.
    Get Your Ticket to Pro LIVE
    Join us at the New York Stock Exchange!Uncertain markets? Gain an edge with CNBC Pro LIVE, an exclusive, inaugural event at the historic New York Stock Exchange.
    In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12.
    Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!

    Don’t miss these insights from CNBC PRO More